First Time Home Buyer

First Time Home Buyer Overview

Are you looking to secure a fantastic mortgage as a first time home buyer?

Being a first time home buyer is an exciting (yet nerve-wracking!) adventure, especially when it comes to gathering information regarding how to purchase your first home; purchasing a home can feel mildly overwhelming which is why it's important to be well-informed so you can confidently take the first steps towards homeownership.

If you're a first time home buyer interested in gaining valuable information about your mortgage options, you've come to the right place!

Being A Homeowner has Many Desirable Benefits

Many of my clients have similar stories for why they enjoy being a homeowner.

Here are some of the reasons:

• You have more freedom over the layout and design of your home
• You don’t have to worry about being renovicted/your landlord selling the home/your landlord evicting you to move in
• Rather than giving funds (rent) towards somebody else's equity, your money goes back into your personal equity
• For the animal lovers out there, owning (usually) makes it much easier to live with pets
• Owning a home is an significant investment; many homeowners create extra income through ownership by renting to others, or from the value of their home increasing with time

Is There Financial Aid For First Time Home Buyers?

It’s important to understand what it means to be a first time home buyer as there are benefits and incentives that as a first time home buyer, you may not be aware of.

In 2019 the Federal government launched a First Time Home Buyer Incentive program through the Canada Mortgage and Housing Corporation (CMHC).

What’s so impressive about this program?

It allows qualified first time home buyers to receive 5% or 10% of the purchase price of their home as a shared-equity mortgage with the Government of Canada.

Simply put, the First Time Home Buyer Incentive can help lower your monthly mortgage payments, and allow some first time home buyers the chance to enter the housing quicker!

Part of the deal is that you’ll eventually pay back this incentive; at the time of repayment (when the property is sold OR after 25 years – whichever comes first), you'll be required to pay back 5% or 10% of your property’s current market value.

Have no fret!

There are limits on the threshold of this repayment that have been put in place to protect YOU in the event that your property has either appreciated (increased) or depreciated (decreased) in value significantly since the time of purchase.

First Time Home Buyer Incentive Protections

According CMHC's website (in the article: 'The first-time home buyer incentive')
"The homebuyer will have to repay the Incentive based on the market value of the home at the time of repayment equal to the percentage (for example, 5% or 10%) of the original home value used to determine the Incentive, up to a maximum repayment amount equal to:

• (i) where the home’s value has appreciated, the Incentive plus a maximum gain of 8% per annum (not compounded) on the Incentive amount from the date of advance to the time of repayment;
-OR-
• (ii) where the home’s value has depreciated, the Incentive minus a maximum loss of 8% per annum (not compounded) on the Incentive amount from the date of advance to the time of repayment.annum (not compounded) on the Incentive amount"

You don’t need to wait the full 25 years to repay the Incentive – first time home buyers may repay at any time without facing pre-payment penalties.

High five!

Sounds Helpful! Do I Qualify?

Possibly!

Although designed to benefit a large portion of first time home buyers, the First Time Home Buyer Incentive does have a few requirements.

In order to qualify for a FULL exemption, applicants must meet these criteria

• It must be you or your partners first time buying a home
• Your total annual qualifying income is under $120,000 (if the home you are purchasing is in Toronto, Vancouver or Victoria it must be under $150,000)
• You must be either a Canadian citizen, permanent resident or non-permanent resident who is authorized to work in Canada
• The amount you are borrowing may not exceed more than 4x your qualifying income (4.5x if the home you are purchasing is in Toronto, Vancouver or Victoria)
• You have enough traditional funds to fulfill the minimum down payment requirement for your purchase
• The home you are buying is located in Canada and you plan to occupy it full-time/don’t plan on using it as an investment property

Certain exceptions or other factors may apply - connecting with an experienced licensed mortgage broker is a great resource to ensure you've checked all the boxes, leaving no rock unturned.

*Requirement thresholds are subject to periodic increases as property values and overall income levels rise with time.

Taking Advantage Of The First Time Home Buyer Incentive

Chat with a licensed mortgage broker (such as myself!) to discuss your mortgage options and learn whether or not the First Time Home Buyer Incentive is a suitable option for your unique borrowing situation.

I'm Kyle Benzies (licensed mortgage broker); I have extensive experience in helping first time home buyers (just like yourself!) get APPROVED for amazing mortgages. My negotiation skills, transparency, and caring nature helps me guide my clients into positive mortgage journeys. Regardless of where you're at in the mortgage process, I'd love to be a helping hand.

For a no-risk call to discuss your mortgage options, feel free to give me a call!

***other conditions may apply to anything listed above. The information provided on this page should NOT be implicitly relied upon, and may not be 100% up to date. It's best to contact us for the most current conditions/program offerings for first time buyers***